Privatization in Disability Services 

 CW: Death

According to a new study published Tuesday, private equity firms are acquiring facilities that care for people with intellectual or developmental disabilities at an alarming rate. Historically, nonprofits and faith-based organizations have owned and operated the care industry for this demographic.

 According to the Private Equity Stakeholder Project, a nonprofit watchdog focused on the growing impact of the private equity industry, private equity firms acquired over 1,000 disability and elder care providers between 2013 and 2023, a likely undercount.

While private equity ownership of nursing homes and autism care centers has been closely studied, the media has paid less attention to its impact on disability care. The research shows the abuse, neglect, and even fatalities of people with IDD cared for by private equity-owned providers, as well as how their influence over this population’s health care is increasing. While the hidden structures of private equity firms frequently conceal financials and lived realities from the public, the effects of this impact may be enormous. 

Private equity firms have a long record of abuse and neglect in many healthcare settings. People with intellectual and developmental disabilities often confront many healthcare challenges such as increased rates of diabetes and mental illness. 

“They’re happening in the places where people live and they’re happening in a way that can impact the whole of a person’s life, not just going to unemployment or seeing a doctor when you’re sick,” said Eileen O’Grady, the report’s author. “It’s your whole life, where you live, where you eat, who you talk to everyday. The level of potential harm is way amplified in those settings.

Several characteristics that have emerged over the last decade have made the care market for people with IDD particularly appealing to private equity firms. In recent decades, the disability community has advocated for care to be provided in integrated community settings rather than institutions such as intermediate care facilities. 

Home care has grown in popularity, resulting in the establishment of numerous small-scale and regional facilities and organizations. As care has improved, so has demand for services, as persons with intellectual and developmental disabilities’s life expectancy has risen. For instance, the average life expectancy of a person with Down Syndrome is now approximately 60 years of age. Around 1983, people with Down Syndrome were only expected to live until they were approximately 25 years old. 

However, in recent years, the industry has struggled to find enough employees to meet demand. This “highly fragmented landscape” made it simple for private equity groups like Alpine Investors and Centerbridge Partners to participate. “As private equity-owned platforms have gobbled up small regional providers and consolidated them, several large private equity-owned companies have emerged with tens of thousands of employees at numerous locations across the United States,” according to the research. 

Alpine owns Team Services Group, which employs around 100,000 people across 11 states. Centerbridge owns Help at Home and Sevita Health, which employ a comparable number of people across nearly 40 states.

The ensuing care and services are beginning to resemble the harms and hardships of institutional care, which the disability community has worked hard to avoid. According to the current research, staffing has been reduced, employees are underpaid, therapy programs have been slashed, and many housing conditions are dangerous or unhygienic.

The issues are not exclusive to one company or state. Senators in the United States released two investigative findings on Sevita,  in 2020, revealing widespread neglect and a pattern of bad care in Iowa and Oregon. Sevita also owns NeuroRestorative, a smaller service that nearly lost its license to operate in Florida in 2024 for failing to “protect the rights of its clients to be free from physical abuse by initiating inappropriate and excessive restraints.”

Furthermore, a 2022 investigation by the Austin American-Statesman discovered that the Medicaid waiver system in Texas was so poorly controlled that it resulted in “horrific” episodes that injured or killed numerous disabled people. According to the report, four private equity-owned employees employed half of the employees that put their clients’ lives in jeopardy.

 In North Carolina, private equity owns more than half of the beds for patients with IDD. RHA Health Services, acquired by Blue Wolf Capital Partners in 2019, manages 42% of the total beds. BrightSpring, owned by private equity company KKR, manages 11% of the beds.

States have some measures for preventing catastrophes, such as monetary penalties or removing a license to provide care. However, the nature of private equity ownership allows them to slough off their system in one area without repercussions in other states or regions.

A recent obstacle against this trend arose in 2024 when the Biden administration published a rule that strengthened federal oversight procedures for providers of home and community-based services. The rule created a stir since it mandated that 80% of Medicaid funding go to workers’ compensation. Republican senators have urged the Trump administration to rescind this rule. Another potential stumbling block: states must enhance the mechanism for individuals receiving home and community care to report negative experiences by 2026.

The privatization of disability services is dangerous. People’s lives should be more important than politics. 

Sources:

Bannow, Tara. “Parents and Clinicians Say Private Equity’s Profit Fixation Is Short-Changing Kids with Autism.” STAT, Boston Globe Media, 31 July 2023, http://www.statnews.com/2022/08/15/private-equity-autism-aba-therapy/. 

Broderick, O. Rose. “Private Equity ‘gobbling’ up Care Facilities for People with Disabilities.” STAT, Boston Globe Media, 18 Mar. 2025, http://www.statnews.com/2025/03/18/private-equity-ownership-care-homes-intellectual-developmental-disabilities/. 

Egusa, Chris. “Former Disability Group Home Admin Accuses Parent Company of Abuse, Mismanagement .” KALW, San Francisco Unified School District, 2 May 2024, http://www.kalw.org/health/2023-08-29/former-disability-group-home-admin-accuses-parent-company-of-abuse-mismanagement. 

“Facts, Myths, & Truths about down Syndrome.” National Down Syndrome Society, ndss.org/myths-truths. Accessed 22 Mar. 2025. 

Ghisolfi, Caroline, et al. “Abuse, Neglect and Death: How Texas Fails Thousands of Disabled Residents.” The Austin American-Statesman, Gannett Satellite Information Network, 5 June 2023, http://www.statesman.com/in-depth/news/investigates/2022/09/22/texas-medicaid-waiver-system-for-disabled-issues-of-abuse-neglect-death/68304630007/. 

“How Patients Fare When Private Equity Funds Acquire Nursing Homes.” The National Bureau of Economic Research, The National Bureau of Economic Research, 1 Apr. 2021, http://www.nber.org/digest/202104/how-patients-fare-when-private-equity-funds-acquire-nursing-homes. 

Watts, Molly O’Malley, and Barbara Lyons. “Addressing the Shortage of Direct Care Workers: Insights from Seven States.” The Commonwealth Fund, The Commonwealth Fund, 19 Mar. 2024, http://www.commonwealthfund.org/publications/issue-briefs/2024/mar/addressing-shortage-direct-care-workers-insights-seven-states.